Verde AgriTech Plc Announces Plans for First Distribution of Gains and Restructure

Return Expected to Be a Minimum of C$10 Million to Shareholders for FY 2022 While Keeping a Minimum of C$30 Million in the Company, Restructure Expected to Increase Markets for Verde

BELO HORIZONTE, May 24, 2022 -Verde AgriTech Plc (TSX: “NPK”) (OTCQB: “AMHPF”) (“Verde” or the “Company”) is pleased to announce the findings of the Independent Special Committee of the Board of Directors (the “Committee”) to re-domicile Verde to Singapore (the “Re-domiciliation”) to deliver commercial freedoms and benefits. The Committee believes the Re-domiciliation is in the best interests of Verde’s future commercial success, with access to new markets, while helping in the implementation of the Paid for Growth (“P4G”) strategy, a cornerstone program aimed at distributing gains to shareholders while maintaining Verde's expansion without shareholder dilution.

The Committee was composed of Mr. Michael St Aldwyn (Verde’s Lead Independent Director), Mr. Renato Gomes and Mr. Paulo Sérgio Ribeiro Machado, see press release issued on 22 February, 2022.1 Working alongside Verde’s management, the Committee determined that ongoing and expanding sales is expected to generate enough accumulated cashflow in the second half of 2022 to warrant returning gains to shareholders in the coming months.

By year end 2022, the Company expects to be able to return a minimum of C$10 million to shareholders while maintaining a minimum of C$30 million in cash and receivables.

For 2023, Verde expects to continue returning gains to shareholders while maintaining a minimum of C$30M in cash and receivables, in addition to fully self-funding Plant 3, without need for equity or debt financing.

In 2021, the Company had its second profitable year thanks to sales of 400,133 tonnes of Verde’s multinutrient potassium products, BAKS® and K Forte® sold internationally as Super Greensand® (the “Product”), as disclosed in the press release of March 22, 2021.2 Verde’s latest 2022 guidance provides for sales of 1,000,000 tonnes of Product, with projected revenue of C$109.09 million, EBITDA of C$49.06 million and net earnings per share (“EPS”) of C$0.87, as detailed in the press release of May 03, 2022.3

The P4G strategy is not intended to conflict with Verde’s accumulated cashflow funded construction of Plant 3, which is planned for 2023 and is expected to add 10 million tonnes per year (“Mtpy”) production capacity. Plant 3's post-tax net present value is projected at US$2.91 billion (8% discount rate) with an internal rate of return of 427.17%, assuming a potash price at less than a third of current Potassium Chloride (“KCl”) prices and those adopted by Verde. Currently, Verde operates Plant 1 with a capacity of 0.6Mtpy, with Plant 2 on track for commissioning in Q3 2022, with an additional capacity of 2.4Mtpy.


BACKGROUND TO THE RE-DOMICILIATION

Verde is currently domiciled in the United Kingdom, a country with which it has no other business connection beyond its incorporation address and the relatively high costs of reporting and compliance under local regulations. Verde is also aiming at an increased access to a wider commodities market for its products. Furthermore, the United Kingdom bars companies from making any type of payment to shareholders while there are no distributable reserves available in the parent Company. The Re-domiciliation to Singapore will provide all the commercial advantages explained in the next section while also enabling the Verde group of companies (“Group”) to eventually execute its P4G through dividend, variable dividend, share buyback and other potential structures that will be further studied in the event that the Re-domiciliation is completed.

“Over 15 years, Verde has overcome many challenges to reach our current stage of production and profitability. We need to ensure that we are well placed to quickly access new markets and we also consider that the time is approaching for the Company to reward its shareholders, many of whom have unwaveringly supported the Company over many years. P4G will only be adopted without compromising Verde’s accelerated growth trajectory and without depleting a sizeable cash reserve,” affirmed Verde’s Founder, President & CEO Cristiano Veloso.

To implement the Re-domiciliation, Verde shareholders shares will be exchanged for shares in a new Singaporean company (“New Verde”) on a one-for-one basis. Following the share exchange, New Verde will become the sole parent company of the Group. There will be no changes to the respective shareholdings of each Verde shareholder. Verde’s listing on the Toronto Stock Exchange will be replaced with New Verde’s listing on the Toronto Stock Exchange, with no impact on Verde shareholders.

The Re-domiciliation will not impact the Group’s underlying assets or operations, strategy, or business plan.


ABOUT SINGAPORE

Among the jurisdictions analysed by Verde, the Committee chose Singapore because of its advantages to the Company’s business activities and its Shareholders. Noticeably:

- In 2022, Singapore is the number 1 country out of 177 in the Index of Economic Freedom, an annual index and ranking created in 1995 by conservative think-tank The Heritage Foundation and The Wall Street Journal to measure the degree of economic freedom in the world's nations.

- Since 2017 Singapore has held the 2nd position out of 190 countries in the World Bank's Ease of Doing Business Report, which reflects a productive regulatory environment for doing business.

- In 2021, Singapore ranked 4th position out of 180 countries in the Corruption Perceptions Index, an index which ranks countries "by their perceived levels of public sector corruption, as determined by expert assessments and opinion surveys." The index is published annually by the non-governmental organisation Transparency International since 1995.

- Because of its streamlined regulatory environment, Singapore is a major global trading hub for commodities. In agriculture, three of the world's largest commodity trading houses are headquartered in the country: Trafigura, Wilmar International and Olam International.

- According to estimates, as the world’s largest importer of food, Asia is and will continue to be the growth engine for global agriculture. This growth is mainly driven by economies such as India and China.

- Brazil and Singapore have a bilateral tax treaty, signed on May 07, 2018, which will ensure the most efficient flow of profits to the Company.


IMPLEMENTATION

The Re-domiciliation will be implemented by way of scheme of arrangement (the "Scheme") sanctioned by the High Court of England and Wales (the "Court") and will therefore be subject, amongst other things, to approval by Verde shareholders in Court convened general meeting (the “Scheme Meeting”) and sanction by the Court.

If Verde shareholders approve the Re-domicile proposals at the Scheme Meeting and the Scheme is subsequently sanctioned by the Court, it is currently envisaged that the Scheme would take effect in July 2022. Prior to the Scheme becoming effective, an application will be made to the Toronto Stock Exchange to de-list the ordinary shares of the Company and to list the new ordinary shares to be issued to Verde shareholders pursuant to the terms of the Scheme on the exchange. It is expected that the de-listing of the Company's ordinary shares and the listing of New Verde’s ordinary shares will both take effect on the same day in July 2022.

The Company will provide Verde shareholders with a circular setting out a detailed timetable, information on the reasons for the Re-domiciliation and an explanation of the Scheme later this month, subject to receipt of the Court's permission to convene the Scheme meeting. Verde shareholders are encouraged to read the circular once available, as it will contain important information in relation to the Re-domiciliation.

The Company will issue a further announcement with anticipated timings in due course.


ABOUT VERDE AGRITECH

Verde is an agricultural technology company that produces potash fertilizers. Our purpose is to improve the health of all people and the planet. Rooting our solutions in nature, we make agriculture healthier, more productive, and profitable.

Verde is a fully integrated Company: it mines and processes its main feedstock from its 100% owned mineral properties, then sells and distributes the Product.

Verde’s focus on research and development has resulted in one patent and eight patents pending. Among its proprietary technologies are Cambridge Tech, 3D Alliance, MicroS Technology, N Keeper, and Bio Revolution.4 Currently, the Company is fully licensed to produce up to 2.8 million tonnes per year of its multinutrient potassium fertilizers K Forte® and BAKS®, sold internationally as Super Greensand®.5 By the end of 2022, it plans to become Brazil's largest potash producer by capacity.6 Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).7 This amounts to 295.70 million tonnes of potash in K2O. For context, in 2021 Brazil’s total consumption of potash in K2O was 7.92 million.8

Brazil ranks second in global potash demand and is its single largest importer, currently depending on external sources for over 96% of its potash needs. In 2021, potash accounted for approximately 2% of all Brazilian imports by dollar value.


CORPORATE PRESENTATION

For further information on the Company, please view shareholders’ deck: https://verde.docsend.com/view/gha7v59kp6eemfaj

INVESTORS NEWSLETTER

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The last edition of the newsletter can be accessed at: https://bit.ly/InvestorsNL-April2022


CAUTIONARY LANGUAGE AND FORWARD-LOOKING STATEMENTS

All Mineral Reserve and Mineral Resources estimates reported by the Company were estimated in accordance with the Canadian National Instrument 43-101 and the Canadian Institute of Mining, Metallurgy, and Petroleum Definition Standards (May 10, 2014). These standards differ significantly from the requirements of the U.S. Securities and Exchange Commission. Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability.

This document contains "forward-looking information" within the meaning of Canadian securities legislation and "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. This information and these statements, referred to herein as "forward-looking statements" are made as of the date of this document. Forward-looking statements relate to future events or future performance and reflect current estimates, predictions, expectations, or beliefs regarding future events and include, but are not limited to, statements with respect to:

the estimated amount and grade of Mineral Resources and Mineral Reserves;
the PFS representing a viable development option for the Project;
estimates of the capital costs of constructing mine facilities and bringing a mine into production, of sustaining capital and the duration of financing payback periods;
the estimated amount of future production, both produced and sold; and,
estimates of operating costs and total costs, net cash flow, net present value and economic returns from an operating mine.

Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives or future events or performance (often, but not always, using words or phrases such as "expects", "anticipates", "plans", "projects", "estimates", "envisages", "assumes", "intends", "strategy", "goals", "objectives" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements.

All forward-looking statements are based on Verde's or its consultants' current beliefs as well as various assumptions made by them and information currently available to them. The most significant assumptions are set forth above, but generally these assumptions include:

the presence of and continuity of resources and reserves at the Project at estimated grades;
the geotechnical and metallurgical characteristics of rock conforming to sampled results; including the quantities of water and the quality of the water that must be diverted or treated during mining operations;
the capacities and durability of various machinery and equipment;
the availability of personnel, machinery, and equipment at estimated prices and within the estimated delivery times;
currency exchange rates;
Super Greensand® and K Forte® sales prices, market size and exchange rate assumed;
appropriate discount rates applied to the cash flows in the economic analysis;
tax rates and royalty rates applicable to the proposed mining operation;
the availability of acceptable financing under assumed structure and costs;
anticipated mining losses and dilution;
reasonable contingency requirements;
success in realizing proposed operations;
receipt of permits and other regulatory approvals on acceptable terms; and
the fulfilment of environmental assessment commitments and arrangements with local communities.

Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Many forward-looking statements are made assuming the correctness of other forward-looking statements, such as statements of net present value and internal rates of return, which are based on most of the other forward-looking statements and assumptions herein. The cost information is also prepared using current values, but the time for incurring the costs will be in the future and it is assumed costs will remain stable over the relevant period.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that estimates, forecasts, projections, and other forward-looking statements will not be achieved or that assumptions do not reflect future experience. We caution readers not to place undue reliance on these forward-looking statements as a number of important factors could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates assumptions and intentions expressed in such forward-looking statements. These risk factors may be generally stated as the risk that the assumptions and estimates expressed above do not occur as forecast, but specifically include, without limitation: risks relating to variations in the mineral content within the material identified as Mineral Resources and Mineral Reserves from that predicted; variations in rates of recovery and extraction; the geotechnical characteristics of the rock mined or through which infrastructure is built differing from that predicted, the quantity of water that will need to be diverted or treated during mining operations being different from what is expected to be encountered during mining operations or post closure, or the rate of flow of the water being different; developments in world metals markets; risks relating to fluctuations in the Brazilian Real relative to the Canadian dollar; increases in the estimated capital and operating costs or unanticipated costs; difficulties attracting the necessary work force; increases in financing costs or adverse changes to the terms of available financing, if any; tax rates or royalties being greater than assumed; changes in development or mining plans due to changes in logistical, technical or other factors; changes in project parameters as plans continue to be refined; risks relating to receipt of regulatory approvals; delays in stakeholder negotiations; changes in regulations applying to the development, operation, and closure of mining operations from what currently exists; the effects of competition in the markets in which Verde operates; operational and infrastructure risks and the additional risks described in Verde's Annual Information Form filed with SEDAR in Canada (available at www.sedar.com) for the year ended December 31, 2021. Verde cautions that the foregoing list of factors that may affect future results is not exhaustive.

When relying on our forward-looking statements to make decisions with respect to Verde, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Verde does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by Verde or on our behalf, except as required by law.



For additional information please contact:

Verde AgriTech Plc
Cristiano Veloso, Founder, Chairman & Chief Executive Officer
Tel: +55 (31) 3245 0205
Email: investor@verde.ag
www.investor.verde.ag | www.supergreensand.com | www.verde.ag



1 See press release at: https://investor.verde.ag/verde-announces-creation-of-independent-special-committee-of-the-board-of-directors/
2 See press release at: https://investor.verde.ag/verdes-q4-sales-by-volume-grow-137-driving-2021-net-profit-growth-to-540/
3 See press release at: https://investor.verde.ag/verdes-2022-guidance-and-two-year-outlook-revised-upwards/
4 Learn more about our technologies: https://verde.docsend.com/view/yvthnpuv8jx6g4r9
5 See the release at: https://investor.verde.ag/2-5-million-tonnes-per-year-potash-mining-concession-granted-to-verde/
6 See the release at: https://investor.verde.ag/verde-to-reach-3-million-tonnes-potash-production-capacity-in-2022/
7 As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf
8 Union of the Agricultural Fertilizers and Correctives Industry, in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários, no Estado de São Paulo).